S. Hrg. 105±487 THE EXPLODING PROBLEM OF TELEPHONE SLAMMING IN AMERICA HEARINGS BEFORE THE PERMANENT SUBCOMMITTEE ON INVESTIGATIONS OF THE COMMITTEE ON GOVERNMENTAL AFFAIRS UNITED STATES SENATE ONE HUNDRED FIFTH CONGRESS SECOND SESSION FEBRUARY 18, 1998 (PORTLAND, MAINE) UNAUTHORIZED LONG DISTANCE SWITCHING ``SLAMMING'' AND APRIL 23, 1998 Printed for the use of the Committee on Governmental Affairs ( U.S. GOVERNMENT PRINTING OFFICE 46±904 cc WASHINGTON : 1998 For sale by the Superintendent of Documents, Congressional Sales Office U.S. Government Printing Office, Washington, DC 20402 COMMITTEE ON GOVERNMENTAL AFFAIRS FRED THOMPSON, Tennessee, Chairman SUSAN M. COLLINS, Maine JOHN GLENN, Ohio SAM BROWNBACK, Kansas CARL LEVIN, Michigan PETE V. DOMENICI, New Mexico JOSEPH I. LIEBERMAN, Connecticut THAD COCHRAN, Mississippi DANIEL K. AKAKA, Hawaii DON NICKLES, Oklahoma RICHARD J. DURBIN, Illinois ARLEN SPECTER, Pennsylvania ROBERT G. TORRICELLI, BOB SMITH, New Hampshire New Jersey ROBERT F. BENNETT, Utah MAX CLELAND, Georgia HANNAH S. SISTARE, Staff Director and Counsel LEONARD WEISS, Minority Staff Director LYNN L. BAKER, Chief Clerk PERMANENT SUBCOMMITTEE ON INVESTIGATIONS SUSAN M. COLLINS, Maine, Chairman SAM BROWNBACK, Kansas JOHN GLENN, Ohio PETE V. DOMENICI, New Mexico CARL LEVIN, Michigan THAD COCHRAN, Mississippi JOSEPH I. LIEBERMAN, Connecticut DON NICKLES, Oklahoma DANIEL K. AKAKA, Hawaii ARLEN SPECTER, Pennsylvania RICHARD J. DURBIN, Illinois BOB SMITH, New Hampshire ROBERT G. TORRICELLI, New Jersey ROBERT F. BENNETT, Utah MAX CLELAND, Georgia TIMOTHY J. SHEA, Chief Counsel and Staff Director DAVID MCKEAN, Minority Staff Director PAMELA MARPLE, Minority Chief Counsel MARY D. ROBERTSON, Chief Clerk (II) C O N T E N T S Opening statements: Page Senator Collins ................................................................................................. 1, 53 Senator Durbin ................................................................................................. 3, 55 Senator Levin .................................................................................................... 70 WITNESSES WEDNESDAY, FEBRUARY 18, 1998 (Portland, Maine) Susan Deblois, Principal, Albert S. Hall School, Waterville, Maine ................... 6 Pamela Corrigan, West Farmington, Maine .......................................................... 7 Steve Klein, Mermaid Transportation Company, Portland, Maine ..................... 9 Susan Grant, Vice President, Public Policy, and Director, NCL's National Fraud Information Center, National Consumers League ................................. 18 Daniel Breton, Director, Governmental Affairs, Bell Atlantic ............................. 22 Hon. Susan Ness, Commissioner, Federal Communications Commission .......... 36 THURSDAY APRIL 23, 1998 Eljay B. Bowron, Assistant Comptroller General for Special Investigations, Office of Special Investigations, U.S. General Accounting Office, accom- panied by Ronald Malfi, Financial and General Investigations Assistant Director ................................................................................................................. 58 Hon. William E. Kennard, Chairman, Federal Communications Commission ... 72 ALPHABETICAL LIST OF WITNESSES Bowron, Eljay B.: Testimony .......................................................................................................... 58 Prepared Statement ......................................................................................... 119 Breton, Daniel: Testimony .......................................................................................................... 22 Prepared Statement with an attachment ....................................................... 106 Corrigan, Pamela: Testimony .......................................................................................................... 7 Prepared Statement ......................................................................................... 89 Deblois, Susan: Testimony .......................................................................................................... 6 Prepared Statement ......................................................................................... 87 Grant, Susan: Testimony .......................................................................................................... 18 Prepared Statement ......................................................................................... 94 Kennard, Hon. William E.: Testimony .......................................................................................................... 72 Prepared Statement ......................................................................................... 130 Klein, Steve: Testimony .......................................................................................................... 9 Prepared Statement ......................................................................................... 91 Ness, Hon. Susan: Testimony .......................................................................................................... 36 Prepared Statement ......................................................................................... 113 (III) IV Page APPENDIX Exhibit List for February 18, 1998ÐField Hearing, Portland, Maine * May Be Found In The Files of the Subcommittee 1. Letter from Susan Ness, Commissioner, Federal Communications Com- mission, dated March 20, 1998, to The Honorable Susan M. Collins, Chairman, Permanent Subcommittee on Investigation, clarifying answers and giving additional data to testimony provided at Subcommittee's Feb- ruary 18, 1998 hearing ..................................................................................... 144 2. Statement for the Record of Sprint Corporation ............................................ 148 3. Statement for the Record of AT&T Corporation ............................................ 151 4. Statement for the Record of Frontier Corporation ......................................... 164 5. Statement for the Record of MCI Communications Corporation .................. 169 6. Statement for the Record of Richard G. Hulsey, Principal, SYNAPSE Networking, Lewiston, Maine .......................................................................... 178 7. Material received from Derek D. Davidson, Assistant Director, Consumer Assistance Division, Maine Public Utilities Commission, Augusta, Maine . 187 8. Material received from Patrick Eisenhart, Owner of The OP Center, Portland, Maine ................................................................................................ * 9. AT&T Form Letter to Resellers, received from Robin Sayre, Public Rela- tions Manager, AT&T ....................................................................................... * Exhibit List for April 23, 1998 1. Letter from Glenn S. Richards, Fisher Wayland Cooper Leader & Zaragoza, L.L.P., Counsel for Discount Calling Card (DCC), dated Novem- ber 29, 1994, to the Federal Communications Commission (FCC), regard- ing filing of Tariff FCC No. 1, Domestic Resale Common Carrier Service .. * 2. FCC Tariff No. 1, Domestic Interchange Telecommunications Services, for Discount Calling Card (DCC), effective November 30, 1994 ................... * 3. Letter from Daniel Fletcher, President, Phone Calls Inc. (PCI), dated June 3, 1996, to the Federal Communications Commission (FCC), regard- ing PCI's Application to Operate as an International Resale Carrier, enclosing FCC Form 159 and $705 check to cover filing fee ......................... * 4. a. Letter from Sandra Platt, President, Phone Calls, Inc. (PCI), dated August 1, 1996, to the Federal Communications Commission, regard- ing filing of Tariff FCC No. 1 for Domestic Resale Common Carrier Service and Tariff FCC No. 2 for International Resale Common Carrier Service .......................................................................................................... * b. FCC Tariff No. 1, Domestic Interchange Telecommunications Services, for Phone Calls, Inc. (PCI), effective August 2, 1996 ............................... * c. FCC Tariff No. 2, International Interchange Telecommunications Serv- ices, for Phone Calls, Inc. (PCI), effective August 2, 1996 ....................... * 5. Complaints received by the Federal Communications Commission (FCC) against Fletcher companies: a. Complaint received by the FCC on June 19, 1995, from Jean Branno of Blackwood, New Jersey, against Discount Calling Card ..................... * b. Complaint received by the FCC on April 4, 1996, from Christopher James Guss of Potomac, Maryland, against Discount Calling Card ....... * c. Complaint received by FCC on April 18, 1996, from John Sun of Palm Beach Gardens, Florida, against Long Distances Services, Inc ..... * d. Complaint received by FCC on June 15, 1996, from James W. and Dianne C. High of Frederick, Maryland, against Long Distance Serv- ices, Inc ......................................................................................................... * e. Complaint received by FCC on November 10, 1994, from Israela R. Franklin of Rydal, Pennsylvania, against CCN ........................................ * f. Complaint received by FCC in June 1996, from Gerrold DeBoe of Pompano Beach, Florida, against Long Distance Services, Inc ................ * g. Complaint received by FCC in September 1996, from Kowdle Kanth of Burtonsville, Maryland, against Long Distance Services, Inc ............. * h. Complaint received by FCC on November 30,